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USDA Approves Continued Annual Payments to the National Pork Producers Council

April 20, 2016

Based on its review of the value of the four trademarks that were the subject of the 2006 asset purchase agreement between the National Pork Board (Board) and the National Pork Producers Council (NPPC), the U.S. Department of Agriculture’s (USDA) Agricultural Marketing Service (AMS) is approving continuing annual payments by the Board to the NPPC under the terms of the 2006 agreement. AMS’s review arose out of a lawsuit filed by the Humane Society of the United States (HSUS) challenging USDA’s approval of the agreement and annual payments. As part of its review, AMS directed the Board to contract for an independent expert to provide a valuation of the current value of the trademarks. Stout Risius Ross (SRR) conducted the valuation and accepted input from both HSUS and NPPC, ultimately finding that the value of the trademarks was worth more than the original purchase price and the remaining principal balance. Therefore, AMS is approving the continuing payments under the agreement.

Separately, USDA’s General Counsel sent a letter to the Board’s Chief Operating Officer (COO) regarding the National Pork Board Delegate Body’s advisement urging the Secretary to mount a vigorous defense in the case. USDA’s General Counsel informed the Board COO that the advisement and the letter forwarding it were in violation of the Pork Promotion, Research, and Consumer Information Order and AMS Guidelines forbidding AMS Research and Promotion Boards from using mandatory assessment funds to engage in lobbying for governmental action, and was in direct contradiction to counsel provided by AMS during the Delegate Body meeting. The General Counsel directed that within 30 days, the Board must account for and reimburse all pork checkoff funds related to the Delegate Body action, and suggested that the COO, Board officers, and any other critical staff attend a remedial training on the proper use of pork checkoff funds.